MTNL facing serious debt problems, says govt

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PTI

November 18, 2016

UPDATED: November 18, 2016 18:15 IST

New Delhi, Nov 18 (PTI) Mahanagar Telephone Nigam Ltd (MTNL) is facing "serious" debt problem and is borrowing money to meet its day-to-day requirements, government said today. "In case of MTNL, it has been going slow in upgradation of equipment during the last 4-5 years due to severe financial problems. MTNL is under serious debt burden and is borrowing money to meet its day to day requirements," Communications Minister Manoj Sinha said in a written reply to the Rajya Sabha.

He said that due to non-investment in access network of fixed lines, service quality issues do come up.

However, in the wireless segment, MTNL has placed the order of mobile expansion and upgradation for an amount of Rs 348 crore during the current and the last financial year.

"BSNL and MTNL are meeting almost all of the Quality of Service benchmarks prescribed by TRAI. However, to improve their service both the PSUs are focusing on upgradation of equipment and infrastructure," Sinha said.

Given that these PSUs are facing shortage of finance to keep pace with their private counterparts, Government has initiatied measures to provide financial assistance in form of refund of surrendered Broadband Wireless Access Spectrum in specific service areas to these corporations -- Rs 4,533.9 crore has been refunded to MTNL through bonds, and Rs 6724.5 crore is being refunded to BSNL through budgetary resources.

Other measures for MTNL include taking over of pension liability of the PSU for its staff who got absorbed from DoT, and financial support (Rs 492.2 crore) on account of liability arising from Minimum Alternate Tax levy.

To improve its mobile services, MTNL has placed purchase order of Rs 295 crore for adding 1080 3G sites in Delhi as part of its network expansion.

Net Neutrality: Government policy on net neutrality will be finalised after taking into account recommendations of committee constituted by Telecom Department and recommendation of TRAI and other inputs to the Government, the Minister said in written reply to another question.